Survey methods make Canadian jobs data more volatile

* May's job gain of 95,000 well above any sampling error

* Statscan takes measures to eliminate variability

* Steps including personal visits, followed by phone calls

By Randall Palmer

OTTAWA, June 7 There's a note of caution
surrounding the stunning gain of 95,000 Canadian jobs in May,
because the method Statistics Canada uses to get its figures
brings both volatility and a wide margin of error.

But Statscan experts still see a 95 percent chance that the
employment gains were between 37,600 and 152,400 in May - a very
substantial monthly increase given the overall size of the
Canadian economy.

Unlike the main U.S. payrolls data, Canada's most closely
watched labor market data is based on monthly interviews with
individual households, a method that is always subject to a
substantial sampling error.

The federal agency surveys about 56,000 households,
representing about 110,000 individuals aged 15 and older. Every
month, five-sixths of those in the sample are people who the
agency has contacted before and one out of six is new.

Economists occasionally question the reliability of the
monthly results or dismiss dramatic swings like the one in May
as anomalies, and even the government looks beyond data from a
single month.

"We don't obviously want to pay too much attention to what
happens month to month, because we know this is very volatile,"
Prime Minister Stephen Harper said on Friday.

Statscan, which has a sterling reputation internationally,
insists its methodology and sample size are more rigorous than
those used in political opinion polls and says it places a lot
of emphasis on eliminating improper variability from its Labor
Force Survey, one of the most closely watched economic
indicators of each month.

"Accuracy is very good compared with the typical political
poll," Statscan analyst Jason Gilmore said.

The agency takes pains to cut the problems pollsters face in
getting an accurate sample, because of the prevalence of
cellphones and because people may simply refuse to answer a
phone if it's a number they do not recognize.

A Statscan official visits most of the households in the
survey in person, and then contacts them again by telephone over
the following five months. During the initial visit, the agency
can collect cellphone and other data to make later contact more
sure.

A separate Statscan report on payroll employment, earnings
and hours is based largely on data from businesses and is more
like the U.S. payrolls survey. However, it appears with a delay
of nearly two months - March data came out on May 29. Canada
does not have any weekly or bi-weekly employment indicators.

Statscan says the standard error in its labor force survey
is 28,700 given the size of its sample and the number of
employed Canadians at 17.75 million.

That means the number of jobs lost or created in any given
month could be up to 28,700 above or below the number provided
by Statscan two times out of three.

That standard error increases to 57,400 when one uses the
more common "19 times out of 20" measure of accuracy. So both
April's gain of 12,500 jobs and March's loss of 54,500 jobs were
both within the margin of error.

The data is adjusted for seasonal factors, such as the
normal upswing in construction employment in the spring and the
layoffs that take place in the autumn.

Hence when May construction employment rose by 42,700, it
rose by that much above the normally higher spring levels.

Gilmore said this may partly reflect unseasonably cold
weather in April, which may have led to builders postponing some
of their hiring into May.

April's seasonally adjusted construction employment figure
was little changed, but the average increase in the two months
of 21,600 does show a boost in activity in the sector beyond the
usual spring jump.

(Adds comments, details)
By Silvio Cascione and Rodrigo Viga Gaier
BRASILIA/RIO DE JANEIRO, Dec 9 Brazil's
inflation rate eased much more than expected in November,
putting a long-missed official target within reach this year and
clearing the path for a more aggressive cycle of interest rate
cuts by the central bank.
Consumer prices as measured by the benchmark IPCA index rose
6.99 percent in the 12 months through November, down from an
increase of 7.87 percent in the

HELSINKI, Dec 9 Greece's plan for a one-off
payout to pensioners before Christmas has not been consulted
with the country's lenders and raises questions if Athens can
return to markets before the end of the bailout, the head of the
euro zone bailout fund ESM said.

Reuters is the news and media division of Thomson Reuters. Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Learn more about Thomson Reuters products: